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PBGH Spotlight
April 2010

Hospital Value Initiative Clears Antitrust Hurdle

“The Hospital Value Initiative [HVI] will likely provide greater information about the relative costs and utilization rates of hospitals in California and lead payers and employers to make more informed decisions when purchasing hospital services,” wrote Christine Varney, Assistant Attorney General in the Department of Justice's Antitrust Division (DOJ). The letter confirmed that the DOJ would not challenge the HVI effort to collect, analyze, and distribute comparative data on cost and resource efficiency among California hospitals in providing inpatient and outpatient services. Read more.

The HVI is a joint effort of the Pacific Business Group on Health, the California Public Employees' Retirement System, and the California Health Care Coalition that represent group purchasers of healthcare services for more than 7 million people. HVI initiated the DOJ business review in 2007 in response to antitrust concerns raised by hospital attorneys that stalled the transparency initiative. Subsequently, the Hospital Value Initiative worked with Milliman to publish a report using publicly available data on Cost Efficiency at Hospital Facilities in California.

PBGH Launches Maternal Quality Care Initiative

The Pacific Business Group on Health, in partnership with the California Maternal Quality Care Collaborative (CMQCC), convened key California maternal and child health leaders and other interested stakeholders in a highly engaging summit to raise awareness and discuss strategies to respond to the alarming increase of maternal mortality and morbidity in California. Rates of maternal death have tripled in the last decade and there are significant racial disparities in maternal mortality and morbidity. These trends are directly related to the 50 percent statewide increase in C-section rates over the past decade. Representatives from hospitals, nursing and physician organizations, employer and consumer groups, health plans, universities, foundations, and state agencies provided valuable and critical feedback on a joint PBGH-CMQCC initiative.

Major steps towards eliminating preventable maternal deaths and injuries in California will include:

  • Educating consumers and providers;
  • Reducing the use of non-medically indicated interventions in maternity care and their associated risks;
  • Promoting adoption and expanded use of a data repository to support quality measurement and improvement; and
  • Aligning benefit design and payment incentives.

California Quality Collaborative Promotes Cost Efficiency and Appropriate Resource Use

A recent California Quality Collaborative meeting showcased several California organizations that implemented targeted initiatives to improve cost efficiency and appropriate resource use. Approximately 100 physician group and health plan leaders from more than 50 organizations throughout California attended the Addressing Cost Efficiency Conference hosted by the California Quality Collaborative (CQC). The conference focused on adopting a data-driven approach to identify high-impact opportunities and interventions and engage physicians in reducing Emergency Department (ED) use. Participants explored how similar strategies could be used in other areas of care delivery, including optimizing resource use in managing low back pain, disease-specific generic prescribing, appropriate use of ambulatory surgery centers, MRI utilization and antibiotic use. Key results included:

  • An IPA in Santa Cruz found that improved primary care access and offering Saturday hours led to a reduction in ED utilization – a select group of practice sites that received support and coaching experienced a reduction in ED utilization of about 14 percent.
  • An IPA in Orange County focused on after-hours and weekend access, providing timely data to physicians regarding ED utilization, and patient and physician education. After experiencing a 7 percent reduction in ED utilization, the group is applying the strategy to increase appropriate use of ambulatory surgery centers (ASC), with appropriate ASC use increasing from approximately 50 to 67 percent.
  • A Northern California IPA saw reductions in ED utilization year after year from 2005 to 2008 using a multi-pronged approach, including improving telephone triage systems and educating office staff, physicians and patients.
  • A Northern California Medi-Cal plan identified pediatric members (aged 1-9) as their highest utilizing group for “avoidable ED visits” and implemented a nurse advice line for this population. Their target population experienced a decrease in ED utilization of 13 percent compared to a control group.
  • Another Northern California Medi-Cal plan addressed appropriate care of low back pain. Their results led to a yearly savings of more than $250,000.

Conference materials and other resources on cost efficiency are available on the CQC website. Read more: 2009 California Quality Collaborative Accomplishments

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PBGH in the Spotlight

Peter V. Lee, PBGH Executive Director for National Health Policy, presented on Delivery and Payment Reform Elements of the Patient Protection and Affordable Care Act of 2010 at a Consumer-Purchaser Disclosure Project Forum.

Arnold Milstein, MD MPH, PBGH Medical Director, presented a keynote address at the Fifth National Pay for Performance Summit on Catalyzing a 60 MPG Healthcare System and led a Summit discussion on Breakthroughs in Cost Efficiency Improvement.

Emma Hoo, Director of Value Based Purchasing presented on Promoting Accountability and Value in Diabetes Care through the eValue8 Health Plan RFI at the St. Louis Area Business Health Coalition.

PBGH Member Highlights

PBGH welcomes Boeing as a new Member. Boeing is the world's leading aerospace company and the largest manufacturer of commercial jetliners and military aircraft combined. Headquartered in Chicago, Boeing employs more than 157,000 people across the United States and in 70 countries. Boeing has a long tradition of leadership and innovation in health care and quality improvement as a founding member of the Leapfrog Group and its health benefits team serves in various leadership roles including the Quality Alliance Steering Committee and Leapfrog Group Board of Directors.

Robert S. Galvin, MD, MBA, Executive Director of Health Services and Chief Medical Officer at General Electric, authored Thinking Clearly About Payment Reform in The American Journal of Managed Care.

About PBGH

Pacific Business Group on Health is one of the nation's top business coalitions focused on health care.  Our 50 large purchaser members spend billions of dollars annually to provide health care coverage to more than 3 million employees, retirees and dependents.  PBGH is a respected voice in the state and national dialogue on how to improve the quality and effectiveness of health care while moderating costs.  Partnering with the state's leading health plans, provider organizations, consumer groups and other stakeholders, PBGH works on many fronts to promote value-based purchasing in health care.